The Effect of Board Characteristics as Corporate Governance Attribute on Firm Performance in Pakistan

Purpose: Most of the prior studies followed board characteristics as corporategovernance attribute, the study to follow on the basis of literature support to useboard characteristics as one of the corporate governance attributes. The objective ofthis research study is to investigate the effect of the board of director's characteristicson firm performance of the Pakistani oil and gas firms listed on Pakistan StockExchange (PSX).Methodology/Design: Data was collected from the annual reports of oil and gasfirms listed on (PSX). The study applies pooled OLS regression on all oil and gasfirms listed on PSX for the period from 2008-2015. Return on assets (ROA) is usedas a proxy for measuring firm performance which is the dependent variable. Whereasthe independent variables used in the study are board size, board independence, CEOduality, board activity.Findings: The board size and board independence are found significant factors offirm’s performance in Pakistan. Whereas, CEO duality and board activity areinsignificant in determining the performance of firms in Pakistani oil and gas firms.Implications: The outcomes and findings of the present study are significant for,regulators, legislators and investors, in order to determine which governancemechanism is important in improving firm performance in Pakistan.